|
What were the goals of the 2012 Share Consolidation?
The goals of the Share Consolidation were to simplify TDS' capital structure, benefit shareholders by improving liquidity and visibility, and give TDS greater financial flexibility.
Back to top
5
When did the 2012 Share Consolidation become effective?
The Share Consolidation became effective as of 5:01 p.m. Eastern time on January 24, 2012. At that time, each TDS Special Common Share was reclassified as one Common Share, each Common Share was reclassified as 1.087 Common Shares, and each Series A Common Share was reclassified as 1.087 Series A Common Shares.
Back to top
5
How did the 2012 Share Consolidation impact the number of shares owned, shareholder voting rights, dividends, and stock tickers?
The following illustration assumes that you owned 100 Special Common Shares as of 5:01 p.m. on January 24, 2012:
Shares: Due to the Share Consolidation, your 100 Special Common Shares were reclassified as 100 Common Shares.
Votes for Directors: The 100 Common Shares continue to have 100 votes in the election of 25% of the directors plus one additional director (or a total of four directors based on the current TDS Board size of twelve directors). As of September 30, 2011, holders of Special Common Shares had approximately 48.4% of the aggregate voting power in the election of these four directors. After the Share Consolidation, in the aggregate, the current holders of Special Common Shares have approximately 46.3% of the voting power in the election of these four directors.
Votes for Other Matters: Although the Special Common Shares did not have a vote in matters other than the election of directors prior to the Share Consolidation, the 100 Common Shares into which such Special Common Shares were reclassified will, as Common Shares, vote in the election of directors and on all other matters. In matters other than the election of directors, the voting power of the 100 new Common Shares float along with the voting power of all other Common Shares so that the total voting power of all Common Shares equals approximately 43.3% (based on shares outstanding on September 30, 2011) of the total voting power of all outstanding shares of common stock in matters other than the election of directors (subject to adjustment based on changes in the outstanding Series A Common Shares). As a result of the reclassification of all outstanding Special Common Shares as Common Shares in the Share Consolidation, the initial per share voting power of each Common Share in matters other than the election of directors is approximately 0.54 votes per share. Accordingly, such 100 Special Common Shares, which previously did not vote in matters other than the election of directors, initially have approximately 54 votes in matters other than the election of directors due to their reclassification as 100 Common Shares in the Share Consolidation, and have voting power that floats depending on the number of outstanding Common Shares and Series A Common Shares.
Dividends: Subject to declaration or change in the per share dividend rate by the TDS Board, you will continue to receive a quarterly cash dividend of $0.1175 per share with respect to the 100 Common Shares that you received upon the reclassification of your 100 Special Common Shares, which is the amount of the per share quarterly dividend all holders of common stock received prior to the Share Consolidation. The amount of the aggregate quarterly dividend that a holder of 100 Special Common Shares received prior to the Share Consolidation was $11.75, based on the current quarterly dividend rate of $0.1175 per share. The amount of the aggregate quarterly dividend you will receive as a holder of 100 Common Shares continues to be $11.75, based on the current quarterly dividend rate of $0.1175 per share.
NYSE: The Common Shares are traded on the NYSE under the symbol "TDS." The Special Common Shares are no longer outstanding and have ceased to trade on the NYSE.
The following illustration assumes that you owned 100 Common Shares as of 5:01 p.m. on January 24, 2012:
Shares: In the Share Consolidation, your 100 Common Shares were reclassified as 108 Common Shares and you received cash in lieu of 0.7 of a Common Share.
Votes for Directors: Prior to the Share Consolidation, the 100 Common Shares had 100 votes in the election of 25% of the directors plus one additional director (or a total of four directors based on the current TDS Board size of twelve directors). After the Share Consolidation, the 108 Common Shares had 108 votes in the election of these four directors. Prior to the Share Consolidation, holders of Common Shares had approximately 51.6% of the aggregate voting power in the election of these four directors. After the Share Consolidation, the current holders of Common Shares had approximately 53.7% of the aggregate voting power in the election of these four directors.
Votes for Other Matters: The 108 Common Shares will continue to vote in matters other than the election of directors. However, the Common Shares will no longer have one vote per share in such matters. Instead, the voting power of the Common Shares floats so that the total voting power of all Common Shares equals approximately 43.3% (based on shares outstanding on September 30, 2011) of the total voting power of all outstanding shares of common stock in matters other than the election of directors (subject to adjustment based on changes in the outstanding Series A Common Shares). As a result of the reclassification of all outstanding Special Common Shares as Common Shares in the Share Consolidation, the initial per share voting power of each Common Share is approximately 0.54 votes per share. Accordingly, the total voting power of such 108 Common Shares initially declines from 108 votes to approximately 58 votes in matters other than the election of directors and thereafter has voting power that floats depending on the number of outstanding Common Shares and Series A Common Shares.
Dividends: Subject to declaration or change in the per share dividend rate by the TDS Board, you will continue to receive a quarterly cash dividend of $0.1175 per share with respect to the 108 Common Shares that you received upon the reclassification of your 100 Common Shares, which is the amount of the per share quarterly dividend all holders of common stock currently receive. The amount of the aggregate quarterly dividend a holder of 100 Common Shares received prior to the Share Consolidation was $11.75, based on the quarterly dividend rate of $0.1175 per share. After the Share Consolidation, the amount of the aggregate quarterly dividend you receive as a holder of 108 Common Shares increased to $12.69, based on the current quarterly dividend rate of $0.1175 per share.
NYSE: The Common Shares continue to trade on the NYSE under the symbol "TDS."
The following illustration assumes that you owned 100 Series A Common Shares as of 5:01 p.m. on January 24, 2012:
Shares: In the Share Consolidation, your 100 Series A Common Shares were reclassified as 108 Series A Common Shares and you received cash in lieu of 0.7 of a Series A Common Share.
Votes for Directors: The 108 Series A Common Shares now have 1,080 votes in the election of 75% of the directors less one director (or a total of eight directors based on the current TDS Board size of twelve directors). Because the Series A Common Shares had almost 100% of the voting power in the election of these eight directors prior to the Share Consolidation, the increased number of shares has no practical effect in the election of these directors.
Votes for Other Matters: The 108 Series A Common Shares now also have 1,080 votes in matters other than the election of directors. However, the voting power of the Series A Common Shares in matters other than the election of directors is fixed based on shares outstanding immediately prior to the effectiveness of the Charter Amendments (approximately 56.7% based on shares outstanding on September 30, 2011) and can decrease depending on the number of outstanding Common Shares and Series A Common Shares. The additional Series A Common Shares issued in the Share Consolidation will not increase the aggregate percentage voting power of the Series A Common Shares in matters other than the election of directors above 56.7% (based on shares outstanding on September 30, 2011).
Dividends: Subject to declaration or change in the per share dividend rate by the TDS Board, you will continue to receive a quarterly cash dividend of $0.1175 per share with respect to the 108 Series A Common Shares that you received upon the reclassification of your 100 Series A Common Shares, which is the amount of the per share quarterly dividend all holders of common stock received prior to the Share Consolidation. The amount of the aggregate quarterly dividend a holder of 100 Series A Common Shares received prior to the Share Consolidation was $11.75, based on the quarterly dividend rate of $0.1175 per share. After the Share Consolidation, the amount of the aggregate quarterly dividend you receive as a holder of 108 Series A Common Shares increased to $12.69, based on the current quarterly dividend rate of $0.1175 per share.
NYSE: There is no public market for the Series A Common Shares. As a result of the Share Consolidation, the 108 Series A Common Shares are no longer convertible into Special Common Shares, but continue to be convertible into Common Shares on a share-for-share basis, or into 108 Common Shares. Thus, the Series A Common Shares continues to be convertible into a class of stock that is listed and traded on the NYSE.
Back to top
5
If I owned Special Common, Common, or Series A Common Shares as of the Share Consolidation on January 24, 2012, do I need to send in my stock certificates to get new ones?
No. You should not send in your existing stock certificates representing shares of TDS. It is not necessary for holders of Special Common Shares, Common Shares or Series A Common Shares to exchange their existing certificates for new certificates. Shareholders should retain all certificates which currently represent Special Common Shares because such certificates now represent Common Shares. Shareholders should also retain all certificates representing Common Shares and Series A Common Shares. Such certificates continue to represent the number of Common Shares or Series A Common Shares, respectively, identified on the certificates.
Computershare will distribute the additional Common Shares resulting from the Share Consolidation with respect to outstanding Common Shares and the additional Series A Common Shares resulting from the Share Consolidation with respect to outstanding Series A Common Shares, and cash in lieu of fractional shares, in the following manner. Holders of Common Shares and Series A Common Shares are not required to surrender certificates to receive the additional shares or cash in lieu of fractional shares.
No fractional shares are being issued in connection with the reclassification of each Common Share as 1.087 Common Shares or the reclassification of each Series A Common Share as 1.087 Series A Common Shares. The number of additional Common Shares or Series A Common Shares to which each holder of Common Shares or Series A Common Share is entitled as a result of the Share Consolidation is determined as follows. The number of Common Shares or Series A Common Shares held of record by each record holder at the Effective Time is multiplied by 0.087. If the product so obtained is not a whole number, the result will be rounded down to the next smaller whole number and holders of Common Shares or Series A Common Shares will be issued such whole number of Common Shares or Series A Common Shares, respectively. To the extent feasible, certificates will not be distributed with respect to the 0.087 additional shares. Such additional shares will be distributed to record holders in book entry form, to the extent feasible. In lieu of any fractional Common Share or fractional Series A Common Share to which such record holder would have been entitled but for the foregoing rounding, TDS will pay to such record holder an amount in cash equal to the product obtained by multiplying such fraction by the closing price of a Common Share on the NYSE on the last full trading day before the Effective Time.
The former holders of Special Common Shares can request Common Share certificates in exchange for the old Special Common Share certificates, but there is no need to do so. In addition, holders of Common Shares and Series A Common Shares who receive additional shares in book entry form may request certificates for such shares, but there is no need to do so. You can make such requests by contacting TDS' transfer agent and registrar, Computershare Trust Company, at 1-877-337-1575 or online at www.computershare.com.
If you are the beneficial owner of shares held in "street name" by a broker, bank, or other nominee, you should contact such nominee to determine how you will receive your shares and cash in lieu of any fractional shares.
Back to top
5
How did the 2012 Share Consolidation impact the TDS Automatic Dividend Reinvestment and Stock Purchase Plans (DRIPs)?
Prior to the Share Consolidation, TDS sponsored a Special Common Share Automatic Dividend Reinvestment and Stock Purchase Plan, referred to as the "Special Common Share DRIP," a Common Share Automatic Dividend Reinvestment and Stock Purchase Plan, referred to as the "Common Share DRIP," and a Series A Common Share Automatic Dividend Reinvestment Plan, referred to as the "Series A DRIP.
The Special Common Share DRIP was terminated when the Share Consolidation Amendment became effective, and the TDS Special Common Shares ceased trading, on January 24, 2012. Participants in the Special Common Share DRIP automatically had all of the Common Shares into which such participant's Special Common Shares in the Special Common Share DRIP were reclassified credited to the Common Share DRIP in book entry form. Whole and fractional shares were credited to the accounts of participants. Shareholders can request certificates to be issued as set forth in the Common Share DRIP.
Participants in the Common Share DRIP automatically had the additional Common Shares received in the reclassification credited to the account of such participant in the Common Share DRIP in book entry form. Pursuant to the Common Share DRIP, whole and fractional shares were credited to the accounts of participants. As a result, participants were issued fractional shares in lieu of a cash payment. Shareholders can request certificates to be issued as set forth in the Common Share DRIP.
Participants in the Series A DRIP automatically had the additional Series A Common Shares received in the reclassification credited to the account of such participant in the Series A DRIP in book entry form. Pursuant to the Series A DRIP, whole and fractional shares were credited to the accounts of participants. As a result, participants were issued fractional shares in lieu of a cash payment. Shareholders can request certificates to be issued as set forth in the Series A DRIP.
Back to top
5
What were the federal income tax consequences of the 2012 Share Consolidation?
No gain or loss is expected to be recognized by any of the holders of Special Common Shares, Common Shares or Series A Common Shares as a result of the share reclassification, except to the extent of cash received in lieu of fractional shares. For more information, please see the tax-related information below:
Special Common Share Tax Information Related to the 2012 Share Consolidation
Common Share Tax Information Related to the 2012 Share Consolidation
Series A Common Share Tax Information Related to the 2012 Share Consolidation
Back to top
5
Did the 2012 Share Consolidation result in new CUSIP numbers for the Common and Series A Common shares?
Yes. Due to the share consolidation, each remaining class of stock was assigned a new CUSIP number. The new CUSIP number for TDS Common Shares is 879433829, and the new CUSIP number for TDS Series A Common Shares is 879433811.
Back to top
5
Did the 2012 Share Consolidation result in a new stock ticker for the Common Shares?
No. The Common Shares continue to trade on the New York Stock Exchange under the stock ticker "TDS".
Back to top
5
|
